Invest in Bitcoin and Cryptocurrency
By Crypto Nation – 4 April 2020
Thinking of turning to cryptocurrency investing? We will help you in your reflection to have the right bases.
First of all, be aware that at this time it is neither too early nor too late to enter the crypto market. There are better times than others to invest in Bitcoin, but overall there are not really bad ones, because since its introduction, its price has always increased. In addition, the price potential is still very far from its theoretical targets according to several reputable mathematical models.
Why invest in cryptocurrencies?
The Bitcoin is the 2.0 investment, the gold of modern times. It is therefore quite legitimate to be interested in it and to want to invest in the world of cryptocurrencies. This market is in full conquest, and is only at the beginning of its enormous potential. There is therefore still time to join the adventure. Even if you missed the first check mark, rest assured, you are still on time to get on board, because the size of the crypto market is still small, very small, compared to traditional markets.
You must have heard these typical sentences in the media…
“It’s a full-scale scam.” “Bitcoin is for money laundering and the Darknet. “Bitcoin has been dead for several years.”
Bitcoin is here, and has yet to show its real strength. Do your own research , have your own opinion, be able to decide for yourself.
The Bitcoin is the King of cryptocurrencies
With a dominance of around 50% on the entire cryptocurrency market, it is unmistakable. Not 100%? No. It’s not just him in this universe. There are over 10,000 listed cryptocurrencies, and this is number keeps increasing over the years.
So you will have the choice. You can also quickly get lost, but we will guide you ! It’s good to diversify into cryptocurrencies, but you shouldn’t want to overdo it either. Note that among all these projects, a large number are based on the Ethereum blockchain (Token ERC-20), Bitcoin’s most serious competitor. Unfortunately, another large part are scams, and are doomed to go fail.
Beyond all these aspects, investing in cryptocurrencies is investing in a new vision of the future, a decentralized environment, where you take back control of what you have, via a reliable and incorruptible network.
The risky paradise of Cryptocurrencies/Cryptoassets
Cryptocurrencies allow you to realize completely incredible capital gains, it’s true. Without risks? No. You must always be ready to lose what you invest in crypto, to avoid any unpleasant surprises, and surprises there will be! Don’t expect to always be in the green, although obviously the goal is to be in the green more often than in the red. Take a look at our golden rules in crypto.
Cryptocurrency markets are currently in the grip of speculative behavior, which makes these markets very volatile, because they are extremely reactive to the feelings of its players, and therefore always accompanied by a certain uncertainty.
However, investment methods have diversified enormously in recent times and many of them greatly limit risks.
Be careful, risks remain very real, and you must have in mind that you will have to assume alone in case of disappointments.
What is your investor profile ?
It is very important to understand what type of investor you are before committing to cryptocurrency, or any other market for that matter. If you don’t feel like you can handle the stress and all the various other emotions that you are going to go through… You may not be able to handle such an investment, at risk. But with high risk comes high potential for gains.
If you consider yourself ready for such an adventure, then you will need to define your investment profile more precisely. There are more and more methods:
- If you have a more short-term vision, go for Day or Swing Trading, but this requires experience, you don’t become a trader in 2 weeks.
- If you are on medium to long term goals then consider this a real investment, and you will fall more into the Holders category.
This type of profile will be more relevant to generate regular passive income, thanks in particular to Staking! We talk about this further down.
We will see the different methods according to your profile in the next part.
How to invest in cryptocurrencies?
To get started in your investment, we will go through several methods.
Each of them will be supplemented with guides from our site in order to deepen the points concerned.
First of all, we advise you to register on a must-have platform, Binance. Click here to see our guide on this subject .
Then, everything will depend on your profile and your goals.
Simply invest in Bitcoin
If your goal is simply to put Bitcoin aside, which is a noble cause, the easiest way will be to focus on the guides for the following platforms:
Save in a stable way
If you want to take a first step in cryptocurrencies without risk, turn to saving Stablecoins: rates up to 12% interest per year are realistic. Check out our following guides:
Have efficient passive income
If the rates offered by savings are not enough for you, or you want in addition to interests, to be able to profit from price fluctuations, then turn to Staking and Masternodes. The following pages will help you:
Aim for very large long-term capital gains
You want to invest in long term projects, to aim for really big returns, then try to become a brilliant holder. To do this, you should instead go to the following pages:
Make short term profit with trading
To cash-in gains on the short term, but not without risk, consider trading. But beware, you will need a lot of experience to properly tame the crypto market. You can also use leverage effects to maximize your earnings. Be careful here again, you will be exposing yourself to very high risks in an already highly volatile market. To do this, explore the following pages:
As a bonus, our strategy
Otherwise, if you want to have a presence on all fronts, or to diversify as much as possible, we can offer you the method that is personal to us. Do not see investment advice, of course.
Note that our profile is more investment-oriented than trading, and this is reflected in our strategy.
The goal here is to divide our total capital into 4 categories, according to the following scheme:
- 50% of our capital is invested in market leading assets with a high capitalization. So there will be Bitcoin (BTC), Ethereum (ETH), and several other assets like Binance Coin (BNB) or Polkadot (DOT).
- 30% on altcoins with an average capitalization, having interesting fundamentals, which will therefore have a solid upside potential.
- 10% are put in altcoins with low capitalization, which are either new projects or completely forgotten by the market. Here the aspect is highly speculative, and very risky.
- The remaining 10% are funds dedicated to trading, with short-term objectives. If we feel that the market is in an uncertain time or too complex to trade, these funds are directed to stablecoin savings.
We also always keep a certain amount of liquidity, in order to be prepared to reinvest lower in the event of a possible market crash.
Depending on the state of the market, the assets present in the portfolio for the medium to long term are sent for staking, savings, or even farming, in order to generate passive income.
Note that the proportion between Bitcoin and altcoins is variable according to the dominance of Bitcoin on the whole of cryptomonnaies market. If BTC dominance is strong (~ > 50%), too strong, we will direct more funds to altcoins, which may outperform Bitcoin in times to come. And vice versa when the dominance of Bitcoin becomes low (~ <40%).
This method is only indicative, you can gladly draw inspiration from it, but do not consider it as an example to follow.
- Bitcoin and large-cap Altcoins
- Mid-cap altcoins
- Low-cap altcoins
- Trading and Stablecoins
Make sure you read our golden rules for investing in cryptocurrencies, so you will be aware of the best practices essential in this environment.